General Electric has cut its quarterly loss by almost 2 times




American industrial conglomerate General Electric, whose shares are in our analytical coverage, released financial results for the second quarter, according to which net loss almost halved from $ 2.179 billion or 26 cents per share a year earlier to $ 1.188 billion or 14 cents per share. ... Adjusted earnings in the reporting period amounted to 5 cents per share against a loss of 14 cents per share a year earlier, while analysts expected a profit of 3 cents per share.

The company's revenue for the reporting period increased by 9% y / y to $ 18.28 billion, which turned out to be better than market expectations of $ 18.14 billion.

The revenue of the electric power division in April-June increased by 3% y / y to $ 4.3 billion, while analysts had expected the figure at the level of $ 4.09 billion; the revenue of the aviation division increased by 10% YoY to $ 4.84 billion, falling short of analysts' expectations of $ 5.16 billion; in the segment of medical equipment, revenue increased by 14% y / y to $ 4.45 against the consensus forecast of $ 4.30 billion; revenues in the segment of renewable energy sources jumped by 16% y / y to $ 4.05 billion against the forecast of $ 3.87 billion; revenues of the financial division were almost unchanged from a year earlier and amounted to $ 858 million.

Free cash flow of General Electric's industrial operations in the second quarter amounted to $ 400 million, while analysts expected minus $ 338.3 million. At the same time, the company management raised its forecast for free cash flow for 2021 to $ 3.5-5 billion from $ 2.5-4. 5 billion. According to company estimates, adjusted earnings per share for 2021 will be $ 0.15- $ 0.25.

Note that on July 30, the company performed a reverse stock split at a ratio of 8 to 1. Our target price for July 2022 is $ 125.84, which is equivalent to 25% upside potential from current levels. The recommendation is "Buy".

 

 

 

 

 

 

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